The board of Power Grid Corporation of India Ltd (PGCIL) has approved the formation of a joint venture with Nepal Electricity Authority (NEA) for the development of a cross border line.
The proposed joint venture with 50 per cent equity participation by each party will be responsible for implementation of the Indian portion of the proposed 400kV double-circuit Butwal-Gorakhpur cross border transmission line, between India and Nepal.
The proposal was approved at a PGCIL board meeting held on July 6, 2022, PGCIL said in a stock exchange communication.
According to information independently available with T&D India, the Butwal-Gorakhpur line will run 120 km between New Butwal substation at Sunawal Municipality-13 in Nawalparasi district of Nepal, and Gorakhpur substation in Uttar Pradesh, India.
Of the total length, only around 20 km will fall in Nepal while the majority 100 km will be in India. It is learnt that the Nepal portion of the line will be implemented solely by NEA, while the Indian portion will be developed by the proposed equal joint venture between PGCIL and NEA.
The equity contribution by each partner is expected to be around Rs.73.6 crore and the overall project cost is estimated at Rs.400 crore. The line will be equipped to handle transfer capacity of up to 2,000 mw.
Hydropower-rich Nepal will export electricity to India during the rainy season when there is surplus hydropower generation. In winter, Nepal will import electricity from India. It is expected that by 2025 or so, Nepal will have surplus electricity generation capacity of around 8,000 mw that will be primarily targeted for exports, mainly to India.
It is also interesting to note that Nepal, in around April 2021, became the first country to participate in the then newly-launched cross border electricity trade platform of Indian Energy Exchange (IEX). Nepal has also permitted its private sector companies for engaging in electricity trade with India. Earlier, such trade took place only through Nepal Electricity Authority.
Background
In around August 2021, PGCIL and NEA had signed an MoU for joint investment for developing the Butwal-Gorakhpur transmission line. Before that, in around October 2019, the two countries, through a meeting between their energy secretaries, had finalized the investment model for the transmission line. The project is expected to be financed on a debt-equity ratio of 80:20, it is learnt.
Also read: PGCIL Accords Investment Approvals Worth Over Rs.2,000 Crore
Indo-Nepal interconnections
Currently bulk electricity exchange between Nepal and India is taking place through the 400kV double-circuit Dhalkebar (Nepal) – Muzaffarpur (India) line that has a transmission capacity of around 700 mw. Besides, Nepal has interconnections with the Indian grid at various locations, through 11kV, 33kV, 132kV and 220kV lines.
Some of the Indo-Nepal transmission lines proposed are:
- 400kV D/C Gorakhpur (India) – Butwal (Nepal) line [discussed in this story]
- 400kV D/C Dhalkebar (Nepal) – Sitamarhi (India) line
- 132kV D/C Nanpara (India) – Kohalpur (Nepal) line
- Second circuit of 132kV Kataiya (India) – Kushaha (Nepal) line
- Second circuit of 132 kV Raxaul (India) – Parwanipur (Nepal) line
Featured photograph shows the 400kV Dhalkebar GIS substation in Nepal, the first GIS substation in the hilly nation, commissioned in early 2021, by Linxon for Nepal Electricity Authority. This substation is very instrumental in facilitating bulk power exchange between India and Nepal. (Photo: Linxon)
